The TotalBiscuit video covering this is pretty spot on though: nowhere did anyone, Valve or the developer, say why it was taken down...it just happened. Valve could basically do this again in future, at will, to any game they feel like removing. Sure, the game isn't tasteful, but it's a game - there are far more offensive games on Steam. Postal, a game which is literally about murdering people, allows you to urinate on innocents and then slaughter them.
I think the removal of Hatred sets a dangerous precedent. I wouldn't have bought the game personally, and I am not interested in ultra-violence for the sake of ultra-violence, but that isn't to say it wouldn't have had its own little niche or fanbase. Steam is such a powerful and all-consuming platform that this could have a devastating effect for the developer. I am not a fan of this move.